Ridham Desai was very bullish to begin with. He repeatedly exhorted investors to buy stocks aggressively.
Then, when the markets cracked in August – September 2013 in the wake of the QE FED taper and the steep depreciation in the rupee, Ridham Desai lost his nerve and threw in the towel. He advised investors that a great Bear market had set in and they should sell stocks as soon as possible.
Now, that the markets have stabilized and surged, Ridham Desai has gone back to his bullish stance.
In his latest interview to CNBC TV-18, Ridham Desai succinctly explained that the reason for his change of stance was that a lot of good things had happened since then such as the FCNR deposit issuance, the big curbing of gold demand which had led to some repair on the current account side, a more modest Fed taper program etc.
He admitted that he had not forecast these issues when he had made his Bear-market-is-here call.
Now, the important thing is that Ridham Desai has advised investors to buy Information Technology stocks. He called it his “most high conviction sector trades”.
Ridham Desai explained that the fact that the USA and Europe economies were booming meant that I. T. companies would do well irrespective of which way the rupee went up. He emphasized that the I. T. sector would see a lot of demand tailwind over the next several quarters.
Now, this is the kind of macro stuff that savvy investors have to keep an eye on. In fact, thanks to the steep depreciation in the rupee, there has already been a terrific bull market in the Info Tech stocks that a lot of retail investors have missed. On a YOY basis, HCL Tech is up 96%, Tata Consultancy Services (TCS) is up 66% & Infosys is up 52%. Even the Mid-cap stocks like Persistent Systems etc are also booming and have nearly doubled on a YOY basis.
But there is no reason to despair because there is still a lot of money left on the table. The heavy-weights like TCS etc still have a lot of steam left in them. Alternatively, you can consider mid-caps like Mindtree (which happens to be Nalanda Capital’s single largest shareholding) or KPIT Technologies, which is also doing well.
Speaking for myself, I have a bit of Mindtree in my portfolio. I plan to tank up more if there is a correction.